Correlation Between Daewon Media and DB Financial
Can any of the company-specific risk be diversified away by investing in both Daewon Media and DB Financial at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Daewon Media and DB Financial into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Daewon Media Co and DB Financial Investment, you can compare the effects of market volatilities on Daewon Media and DB Financial and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Daewon Media with a short position of DB Financial. Check out your portfolio center. Please also check ongoing floating volatility patterns of Daewon Media and DB Financial.
Diversification Opportunities for Daewon Media and DB Financial
0.3 | Correlation Coefficient |
Weak diversification
The 3 months correlation between Daewon and 016610 is 0.3. Overlapping area represents the amount of risk that can be diversified away by holding Daewon Media Co and DB Financial Investment in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on DB Financial Investment and Daewon Media is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Daewon Media Co are associated (or correlated) with DB Financial. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of DB Financial Investment has no effect on the direction of Daewon Media i.e., Daewon Media and DB Financial go up and down completely randomly.
Pair Corralation between Daewon Media and DB Financial
Assuming the 90 days trading horizon Daewon Media Co is expected to generate 1.95 times more return on investment than DB Financial. However, Daewon Media is 1.95 times more volatile than DB Financial Investment. It trades about 0.21 of its potential returns per unit of risk. DB Financial Investment is currently generating about -0.02 per unit of risk. If you would invest 716,559 in Daewon Media Co on November 3, 2024 and sell it today you would earn a total of 160,441 from holding Daewon Media Co or generate 22.39% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Very Weak |
| Accuracy | 100.0% |
| Values | Daily Returns |
Daewon Media Co vs. DB Financial Investment
Performance |
| Timeline |
| Daewon Media |
| DB Financial Investment |
Daewon Media and DB Financial Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Daewon Media and DB Financial
The main advantage of trading using opposite Daewon Media and DB Financial positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Daewon Media position performs unexpectedly, DB Financial can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in DB Financial will offset losses from the drop in DB Financial's long position.| Daewon Media vs. Hotel Shilla Co | Daewon Media vs. BIT Computer Co | Daewon Media vs. CKH Food Health | Daewon Media vs. Foodnamoo |
| DB Financial vs. Samyang Foods Co | DB Financial vs. Alton Sports CoLtd | DB Financial vs. INSUN Environmental New | DB Financial vs. Heungkuk Metaltech CoLtd |
Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Latest Portfolios module to quick portfolio dashboard that showcases your latest portfolios.
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